Israel drops all tariffs on US imports ahead of Trump's tariff move

Jerusalem: Israel has announced that it will eliminate all tariffs on imports from the United States, according to a joint statement from Israel's Prime Minister's Office and the finance and economy ministries.

The reduction is largely considered a diplomatic and political gesture rather than an economic one, as a 40-year-old free trade agreement between Israel and the United States already exempts 99 per cent of US imports from duties, Xinhua news agency reported.

Israel's finance ministry reports that the remaining tariffs, mainly on agricultural products, amount to approximately 42 million shekels ($11.4 million) annually.

Israel's move to eliminate tariffs on US imports comes at a critical time, just a day before US President Donald Trump's anticipated announcement of new tariffs affecting all US trade partners. This timing has sparked speculation in Israeli media that the move is a strategic attempt to avoid retaliatory duties.

The joint statement noted that reducing tariffs will strengthen strategic relations between the two countries and may help reduce the cost of living in Israel.

Israel's top export destination in 2024 was the United States, with a total export value of $17.2 billion, according to data from Israel's Central Bureau of Statistics. In terms of imports, the US ranked second, with Israel importing $9.2 billion worth of goods from the country in 2024. China topped the list, with Israel importing $13.5 billion worth of goods last year.

(inputs from IANS)